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Thursday, November 10, 2016

President Elect Trump, energy and climate

The elites can only run things with the American people’s permission. Trump is the people’s way of withdrawing their permission. - Salena Zito

I'd been waiting for the American election to be over figuring it limited other serious discussions as it sucked all the oxygen from the blogosphere. Given the outcome, I suspect it will be a low oxygen world for the rest of us for a while yet. Here I'll reference columns from sources I consider relevant on energy, economics and climate change - and then let loose with my own opinions on likely impacts of President Elect Trump for Canada, the Paris agreement, and nuclear energy.

Is this end times for environmental progress or, more specifically, climate progress?
No.
The bad news about climate change is, in a way, the good news:
The main forces determining emission levels of heat-trapping carbon dioxide will be just as much out of President Trump’s hands as they were out of President Obama’s. The decline in the United States has mainly been due to market forces shifting electricity generation from coal to abundant and cheaper natural gas, along with environmental regulations built around the traditional basket of pollutants that even conservatives agreed were worth restricting. (Efficiency and gas-mileage standards and other factors have helped, too, of course.)

Even under Trump, there will still be reason for hope. Political change unfolds in unexpected ways, and not everything on Earth revolves around the machinations of the US federal government. So here are a few reasons to think the fight against climate change is not yet lost:

States like California and New York are still pursuing their own ambitious climate policies...

...the president-elect is more likely to opt for policy changes that can be administered through his executive branch — like repealing the CPP — rather than turning to Congress.
...because the Clean Power Plan is not yet implemented and faces a court challenge, it would be “relatively easy to undo...”
“The Trump administration could come in and submit a motion to ask the court to issue what's called a voluntary remand...They can basically just tell the court this rule has been challenged and litigated and now we intend to revisit the rule, so please send it back to us.”

It’s “more likely than not” that the D.C. Circuit will not yet have ruled by Inauguration Day...

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A legislative move could be a simpler fix than all the rulemaking. With a one-sentence bill, Potts pointed out, Congressional Republicans could redefine the word “pollutant” in the Clean Air Act so that it explicitly excludes CO2. That would “effectively make all the existing Clean Air Act not be a tool for climate regulation.”

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What’s more probable than an assault on renewable energy itself is support for fossil fuels, according to all the experts Utility Dive spoke with.

“I think it's more likely he's going to relax the regulation of natural gas and coal and that would make it essentially less economic for solar and wind”

My thoughts
Certainly Trump's protectionist words are a negative - but I don't put much stock in his words. I expect some minor tinkering with NAFTA would save him face. The one exception, because it was already problematic, is lumber.
The Canadian climate cabals have been pushing a quirky "social license" narrative that links pricing or trading carbon and building out renewables to being wealthy - meaning being seen as so virtuous others will ignore the pulling oil from of the ground and getting it to markets, particularly those on the other side of great big bodies of water. Now there's a President Elect who has stated in his first 100 days in office he will "lift the Obama-Clinton roadblocks and allow vital energy infrastructure projects, like the Keystone Pipeline, to move forward."The pipeline isn't a sure thing, because Trump has a more basehonest pragmatic version of social licence - a piece of the action.

The Paris climate agreement was designed in the US on the basis of it not binding countries to reducing emissions, but requiring countries to set targets on doing so and report on their progress towards doing so.
The philosophy was "name and shame" would inspire action.
Apparently the climate crowd thought America was collectively capable of shame.I did not.
Whether or not Trump withdraws from the agreement is, therefore, irrelevant.

I think the short-term impacts of the Trump victory on nuclear generators will be negative. New York's zero-emission credits (ZEC) is designed around a federal Social Cost of Carbon (SCC). I find it difficult to see it surviving court challenges if/when the Trump administration devalues, or dismisses, the SCC. Attempts in Illinois to build on the New York ZEC design were always unlikely to succeed (Illinois legislators couldn't pass a laxative), but that seems even worst now.

In Ontario, the more comes out of Ontario Power Generations rate application, largely impacted by nuclear refurbishments, the less it appears OPG's financial executives have ever visited earth. OPG isn't alone as the Ontario government has been pushing a narrative that the province has done the heavy lifting in moving off of coal-fired power that others would have to.

With the US Clean Power Plan almost certainly dead, and it unlikely the low-carbon nuclear workhorses will survive (particularly in New York and Illinois), I don't expect most states will think they have to do anything that drives up the costs of electricity.